Military Benefits

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Adult Dependents and their Retired Parents

So now that you’ve had the conversation with your parents about their medical coverage and future care, now comes something a bit more awkward; pension benefits for the surviving parent and funeral arrangements. This is something that all people “of a certain age” (a group to which I belong) should have with their parents, retired armed forces or not. It’s not fun, but it is one of the necessary evils of adulthood. Think of it this way; this is the conversation you get to have with your parents that makes up for the one they had with you about the birds and the bees.

Tension broken and silly comment aside, estate planning is a very serious subject. It’s NOT about being perceived as being greedy. It IS about making sure that your parents get what they want when they pass and also how to make sure your other parent is as comfortable as possible for the rest of his or her life. Make sure you have everything in writing and consult a lawyer.

Pension Benefits

When your parents retired, they were given the option to have the surviving spouse receive a percentage of the pension after the retiree’s death (oftentimes called an annuity at this point). It was not an automatic given; your retiring parent had to sign up. Currently this is known as the Survivors Benefits Plan (SBP). It may also be governed under the Retired Servicemen’s Family Protection Plan or the Reserve Component Survivor’s Benefit Plan.

The cost for this annuity is a percent of the pension, currently no more than 6.5% under the SBP. It is pre-tax, and deductions will stop after 30 years of payment or when the retiree reaches 70 years old. t will provide 55% of the pension benefit for the lifetime of the surviving spouse. There are other options to pay less of a percentage to receive a lower payment after death.

Unfortunately, this had to have been done around the time of the retirement. There are certain caveats (such as your parents getting married after retirement), but there are always rules all basically along the lines of “time is of the essence.” In other words, it had to be changed when the qualifying event happened.

Knowing whether or not your parents have a survivor’s benefit plan in place can help you discuss with your parents what changes if any need to be made in financial and possibly living situations if the retiree dies first. Planning helps take the sting, surprise, and additional grief away that could be avoided in these already trying and complex situations.

Funeral Arrangements

As a military retiree, your parent is entitled to rites performed at the funeral to honor his or her service to the country. This is generally handled by the funeral director, acting as a liaison between the family’s and decedent’s wishes and the Department of Veterans Affairs.

As a retiree, your parent will most likely be eligible for three things; interment at a National Cemetery, a United States flag for the casket (or accompanying the urn) to be folded and presented by an honors detail, and the playing of Taps. Does your parent want any of these things?

In regard to interment at a National Cemetery, is there room at your desired location? There are over 100 National Cemeteries across the United States; many of them, such as the National Memorial Cemetery of the Pacific (otherwise known as Punchbowl), are getting full, and can only take cremated remains or the remains of service members who already have a family plot started. It is imperative that you have a backup plan approved by your parents should their wishes in this context not be able to be fulfilled.

If your parents haven’t already approached you with their plans, you need to verify that they have plans. While this may make you feel ill at ease, it is much better to broach the subject with your parents to make sure that they choose what happens, as opposed to being forced into a situation where they will have to make uninformed and/or last minute decisions, or worse, cause unnecessary conflict between surviving children.